Analyst Downgrades: ARM, Juniper, Chesapeake Energy

Analysts downwardly revised their ratings on ARM Holdings plc (ADR) (ARMH), Juniper Networks, Inc. (JNPR), and Chesapeake Energy Corporation (CHK)

by Alex Eppstein

Published on Jul 13, 2015 at 10:01 AM
Updated on Jul 2, 2020 at 2:23 PM

Analysts are weighing in today on tech titans ARM Holdings plc (ADR) (NASDAQ:ARMH) and Juniper Networks, Inc. (NYSE:JNPR), as well as oil-and-gas issue Chesapeake Energy Corporation (NYSE:CHK). Here's a quick roundup of today's bearish brokerage notes on ARMH, JNPR, and CHK.

  • ARMH saw its rating reduced to "underweight" from "neutral" at J.P. Morgan Securities, which also lowered its price target to $41.50 from $42.75 -- following the lead of Canaccord Genuity. Technically speaking, the stock has had a ho-hum 2015, up just 1.3% to trade at $46.90, after recently breaking lower from the $52-to-$54 range. Traders at the International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX) have been buying to open puts over calls at a rapid-fire rate amid this downtrend. Specifically, during the last two weeks, ARM Holdings plc has racked up a put/call volume ratio of 17.36 -- higher than any other comparable reading from the past year.

  • Nomura cut its price target on JNPR to $26 and reiterated its "neutral" opinion, which is business as usual among analysts. However, this is somewhat surprising, given the stock's 17% year-to-date lead at $26.12. In fact, Juniper Networks, Inc. recently took a bounce off its ascending 100-day moving average, which also supported the shares in March. While Nomura is skeptical, traders at the ISE, CBOE, and PHLX are decidedly bullish. JNPR's 50-day call/put volume ratio of 2.77 outranks 95% of comparable readings from the last 12 months. In other words, speculators have bought to open calls over puts at a faster rate just 5% of the time in the previous year.

  • CHK has had a brutal year, plummeting almost 44% to trade at $10.98 -- including 3.5% this morning -- and touching a six-year low of $9.94 last week. Barclays, which is weighing in on a number of energy stocks today, cut its price target on Chesapeake Energy Corporation to $7 from $10, reflecting the equity's bearish technical trajectory -- and projecting a move to levels not seen since May 2003. There's plenty more negativity among analysts, too. In fact, 80% of brokerages consider the shares a "hold" or worse. However, additional price-target cuts may be in the cards, considering CHK's consensus 12-month price target of $14.50 stands at a significant premium to current trading levels.

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